Nov. 6--While Atmos Energy customers are getting a reprieve from high prices this winter, the utility has asked the state to approve an increase in rates, likely for next year.

The state's largest gas supplier filed a notice with the Public Service Commission seeking to raise the base rate for residential customers from $9.35 a month to $13.50, more than a 44 percent increase. This is one of three portions of a gas bill. The decrease that customers saw this winter was for the actual cost of the natural gas.

Most residential customers, based on their gas usage, would see an increase of about $4.20 a month, according to Kay Coomes, manager of public affairs for Atmos.

A legal advertisement slated to run in the Daily News actually says the utility is proposing to change its rates effective Dec. 1.

"Procedurally they file an application and ask for the rates to take effect in 30 days, which they are entitled to do, but that never happens," said Andrew Melnykovych, spokesman for the PSC. "Normally we suspend the rates for six months before they can take effect and then only subject to a refund, pending the PSC decision, which can take up to 10 months."

"This is the ... revenue that Atmos receives for its delivery system," Melnykovych said. "It has nothing to do with the cost of gas itself."

The PSC actually determines how much if any this base rate can rise, he said.

Coomes said the company's need to seek the increase is pretty straight forward.

"Our current rates are not providing a fair rate of return and since our last rate case, Atmos Energy has invested over $35 million into system improvements and we are projecting an additional $23 million of improvements in this fiscal year, bringing that close to $60 million," Coomes said.

"Atmos Energy is also proposing a pipe replacement program, which will help us replace approximately 250 miles of bare steel facilities," she said. "We estimate the cost of replacement to be over $100 million."

Atmos filed its last rate case in 2006. Melnykovych said gas companies typically ask for a base rate increase every three to five years. Earlier this year raises were approved for Columbia Gas and LG & E, he said.

The company is seeking to change other base rates as well. Non-residential service base charge would go from $25 to $30 a month, an increase of 20 percent.

Large volume customers that have what is called interruptible service also would see a 20 percent increase in the base charge from $250 to $300 a month. Additional gas used above the minimum is considerably lower than it is for other users.

"These customers ... get a lower rate because their service is deemed low priority," Coomes said. "These customers understand, under contract and schedules, and anticipate and permit interruption on short notice, generally in peak load seasons."

In all, Atmos anticipates the rate changes would generate an additional $9.5 million each year, Coomes said. The company serves 170,000 residential and commercial customers, about 40,000 of who are in Warren and surrounding counties.

"It's going to be a while before there is any decision," Melnykovych said.

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